tv Your Business MSNBC August 9, 2009 7:30am-7:59am EDT
hi, there, everyone. i'm jj ramburg. welcome to "your business" where we give you tips and advice to help your business grow. if having a great idea is key to starting a business, then protecting that idea from copy cats and knockoffs is key to staying in business. today we meet two entrepreneurs who have taken on the pirates and are beating them at their own game. >> how much?
i've been searching for the last two weeks for these bags. i'm so pap happy. >>, die just found her dream purse worth more than $300 here on the streets of new york city in the neighborhood better known for offering cheap knockoffs, not the real thing. today these women are finding the real thing. >> thank you. >> it is moving the product in a space that's not all expected. >> michael hastings black is the marketing guru helping an upcoming new york handbag designer. she already semis them at saks fifth avenue and bloomingdale's, but she is worried about copycats stealing creations and selling fake creations for a fraction of the price. >> pirating is the biggest problem.
it is getting worse as it is becoming easier and easier to copy things. >> matt mason is the author of the book "the pirate's dilemma." even with the law on your side, pirating can be nearly impossible to combat. >> pirating is an opportunity for a massive problem. there's also new money to be found in what pirates are doing, because often they are highlighting a different industry or different market or different distribution model. >> after reading mason's book, hastings decided that instead of trying to beat the pirates, why not use them to the company's advantage? >> i would say eight ounces in weight for $10 a piece. >> the nasdaq marketing team put together a campaign. >> one, two, three, go! >> they used a social networking site twitter to send out
messages to more than 1,000 followers to give out clues to help people find real bags where they could expect to find cheap copies. how many people will show up and how fast? >> there's the likelihood within ten to tiff fine minutes they could be sold out. >> he was right. it took less time than that. >> i probably have 10 to 12 friend following on your twitter. >> the campaign was not a money-maker. they sold the bags at $10. they considered cool enough to be copied by a pirate elevated the brand. >> you are walking along and seeing, okay, here's the armani and the chenel. and then who is rachel mesnik? across the country, a video game entrepreneur also found a way to nix the pirates. >> we put up a sign that said pirates we are your friends. i would do that because whereas everybody else in the industry is shunning them, we want them to come and work with us.
>> jamison smu has taken these lessons to heart. >> people who would take contests without the permission of the owner and distribute it across the u.s., and now as we build our business model, we look at the pirates in a different light. >> his strategy begins by accessing pirates on the web cannot be stopped. >> how they distribute on the web now, it is a different model and a different way of syndication. we thought, okay, we can't fight it but we can figure out a way to leverage it. >> what is the secret? >> see, the stain still comes out. >> he builds advertisements into the game he publishes. these advertisements travel with the game every time it is illegally copied or pirated. >> the pirates are helping us to distribute our content to get our games in front of people. they take the games, the package
with our technology and they put the game on their website. what happens is another pirate comes to the website and says, hey, i want that too. i'm going to put it on my site. it happens over and over again. we see the games spread to thousands of websites, so the pirates of these websites are driving traffic through this. >> the more people who play the game the more people see the advertisements and that means more money for the artists. >> we want every single pirate to come to us, take our content because they get it in front of more eyeballs, so pirates are definitely pushing invasion. it has pushed us to build better technology and has pushed us to find better ways to work with them, pushed us to change our business models to better adapt to the things they are doing so that we are not going up against them directly and working with them. >> for these entrepreneurs, they found learning from the pirates may be the best way to stay ahead and the only way to survive. >> the train is leaving and you are either on it or you are
under it. and uh, i mean, that's how he look at it and say the industry has to change. so how can you protect yourself against people trying to steal your intellectual property? these week we'll turn to our board of directors. matt mason is here to talk to us a little bit more. and we have regulars back on the show, divion is here and rod curst is here. great to see all of you guys. i would like to start with you. the last line in the piece, you have to do something to survive. you have to beat them at their own game to survive. is that true? what happened to just suing pirates? >> well, yeah, i mean, the thing about pirates is that sometimes it is possible to sue pirates out of existence completely. if they are adding no value to your business model, if they are not doing anything useful, if
you make it's too paste and they are starting to make counterfeit toothpaste with less poison in it, it is not good for consumers. everybody is happy that will be off the market, but the thing about this is always, always, always there's some kind of hidden value pirates are doing. take toothpaste. you don't want toothpaste on the market, but who is buying it? are they new customers? do they want your it's too paste? can you use the business channel? what piracy does is telling consumers want something else in a different way. also, it will help you figure out how to still make money. >> isn't the issue often that they want it cheap her? >> yeah, i think to get to your point, you have to look at pirates as competitors. they are, they are illegal, but you have to be conscious of it. you want to know what the business is up to legal or
illegal. >> i like the way to create an innovative model around leveraging, the fact that your content and product is going to distribute freely and get revenue opportunity there. beyond that there's a big consumer movement that needs to take place where people are really conscious about what they buy. buying authentic music, movies -- >> how do you get consumers interested in the movement when really they want something for $10? they want it free, really. that's when you can't beat them, join them. what do you do to educate the consumer? >> mine looks a tiny bit different. >> it depends. if you are selling something well with awe ten 'tisty like a handbag, then you are not -- there's a lot of people, if you are selling $2,500 handbags, you don't want the people who will pay $2,500, you don't want them -- >> you are not losing market to them. it is not the same person.
>> just educate them on what the difference is and that will make a huge difference. >> you also see designers changing designs so quickly that by the time it is on the street, it is the old model and the people don't want it anyway. the celebrities aren't carrying it around. >> it is very easy to copy things in the fashion business. it is going all the way around on the food chain in fashion. a really smart way to compete with pirates is to bridge it in the industry. you have jeorgio armani and then imporium armani. you have the flagship brand. that's the way to do it. >> matt, thank you so much for coming on the program. i know you have gotten a lot of people to think creatively beyond calling their lawyer. we appreciate it.
it is time to answer some of your business questions. the first one comes from the owner of a barbecue restaurant. >> i would love to know how to get good help. we have been in business since 1971 and we have a wonderful inner core of people that have stayed with us, but i find it harder and harder to find people that are actually interested in doing a good job. >> interesting that she feels like it has changed in the past 40 years since she started, but how does she find someone? >> she mentions the solution is under her nose. a great inner core. use them to get referrals to new people. that's the best way to get great talent. she can also leverage using online tools linked in which are really good. when you connect to your professional business contacts on there, send out a job description. you don't know what you are going to get in. >> i have used craigslist before. >> unemployment is 10%.
there are a lot of good people out there. i think the important thing to keep in mind if you are in the barbecue business or whatever it might be, you don't really need 1,000 resumés. you need one good person. i would sort of start in the inner circle, the people you know. the personal referrals are the best way to find people. there might be someone you never met or never heard of, but your friend knows them very well. >> also, i say have a three-month trial period. hire a lot of interns, test them out to see if they do a good job. hire them if they do. >> and be honest about what you are expecting so they know what they are getting into. >> interns are a great way to start. if you have a great intern program, that's the first place you should look. the next one is about marketing from a personal trainer named denise who writes, i placed an ad in a local church brochure for one year. i placed business cards in a main-line running store. i placed an ad on craigslist and posted a flyer in the park.
i got one resfrops from the church prosure ad and one unsavory response from craigslist. >> you do have to be careful. in looking in a situation like this is specially at a time like now, nothing comes free. maybe in the case of a personal trainer, you give away a free session if you buy two. free gets people raes really interested. >> you have to leverage your existing customer base to do your marketing for you. forget budgets. this is the world of free. get great clients, giver give away services to a spokesperson to support your brand. also, leverage-free online tools like twitter and facebook, all the sites to get the word out there. >> maybe we combine top two, for existing customers, if you refer someone you get a free session. something like that. >> referral business as well. >> also, maybe she holds something at a local park for free. come for -- >> boot camp. >> exactly. if you have a couple sessions
for free, that gets people coming back. >> all right. now, the next one. a question from the owner of a specialty foods group. >> in our company we have trademarks and we have gone out there, but i have heard of having the ability to having a trademark by having the writer first use. is there really a writer first use on a trademark? >> looking to see if someone else has your name. >> there is. if people are using a trademark and haven't registered it, there's a limited scope on what they have been doing with it. when the second party comes in and decides to register the trademark, they have better advantages to doing so, so, yes, there is some advantages to using it without having it, but really the best thing to do is register it. >> i'm not a lawyer, be but my understanding is if you have a brand or a trademark, the minute you sell something to the public, you have a much better case to lay legally claim to the
trademark. he is sort of right if you get out there and sell it you do in a sense own the trademark. >> you have to do a broader search than to see if someone has a trademark on something to. the last one, this is from elise. i have to break my lease because my sales are down and my landlord is unwilling to negotiate my rent. i can't pay the rent but i need an office space. i tried to sublet some space but nobody is interested. >> look for a less expensive space. >> but what do you do with your old space when your landlord is going to sue you? >> first, try to avoid getting sued. if you can work on that, option number one. talk to the landlord and tell him the situation you are in. have him work with you. if you come to the agreement you can no longer afford the space, just leave. he won't sue you. do whatever he wants you to do and get out. >> i'm only smiling because i think in their case it sound like they are going to get sued.
which seems crazy, right? a lose-lose situation for everyone. you are going to sue for money that doesn't exist. >> if you get out there and you are out of the space and you treated it well, then you have better ground to stand on. >> the first thing you need to do is read your lease and read the break clause there might be. this could be nay vooef, but i don't think somebody wants to go to court. some people love to sue, but it is in no one's interest. they are suing for money that doesn't exist. you want to be confident in trying to come up with an arrangement, go to month-to-month, do anything to get yourself out of this and keep plugging away to find someone to sublet the space. >> offer to pay less now but more in two years from now. >> if you work it out ammicbly, this is better than paying legal fees to sue you and not get any money for it. >> it costs a lot of money every time a building is vacant. it will cost the landlord money on that end. really, you have to appeal to
their logic and say, really, do you want to sue? >> have a good relationship with your landlord at all times in case something happens at the end. >> thank you so much, guys. stick around. we'll bring you back for the elevator pitch later. we have a fun one today. and we want to invite all of you out there to send in a question if you have one for the experts. head to our website. you can submit your questions by clicking on the contact us link. while you are on the site, view this segment and other portions of the show en. we also have web exclusive content and videos. you can find it all at yourbusiness.msnbc.com. now that we have heard from the experts, more advice from small business owners just like you. >> it is a huge mistake. when you are approaching capital, think about the issue that is go into bringing about raising capital and your corporate structure. >> i think the biggest thing for
us is to really have a much more active hands-on approach to the business and really pay attention to every aspect of the business. >> don't lose faith in your abilities by making mistakes. i've been doing this for 30 years and i continue to make mistakes and quite often the same mistakes. hopefully, they are not the same mistakes close together. every five years, eight years, you look better and say, i shouldn't have allowed that to happen. you just keep moving forward. >> there's more advice ahead to help you run your small business. she inherited her entrepreneurial spirit from her designer dad. now dylan lauren tells us about her success with her chain of candy stores. and the panel is about to get cornered with an elevator really recipe to spice up the festivities.
during times like these it seems like the world will never be the same. but there is a light beginning to shine again. the spark began where it always begins. at a restaurant downtown. in a shop on main street. a factory around the corner. entrepreneurs like these are the most powerful force in the economy. they drive change and they'll relentless push their businesses to innovate and connect. we look to the future, they'll be there ahead of us, lights on, showing us the way forward. this is just the beginning of the reinvention of business. and while we're sure we don't know all the answers, we do know one thing for certain, we want to help.
come see what the beginning looks like at openforum.com ♪ sweet dreams of are made of these ♪ dylan loren wants to conquer the world with candy. a sweet spot is hit with children and adults. the daughter of ralph lauren and photographer ricky lauren, she talks to us about leadership, following your gut and branding. ♪ i want candy ♪ i want candy >> it is a very creative
innovative concept that did not exist before this store was built. i think there are very few sort of retail entertainment stores. dylan's candy bar is a place where you walk in the door and immediately smile, candy you haven't seen since you were a kid or candy you love, and you see the colors and giant lollipop trees it makes people happy. it's got a good energy so i think it's being able to merge in pop culture and the arts and the fun with real business. ♪ candy, candy, candy >> i definitely think it's important for a business leader to follow their gut, somethin s that's innate and you look at products that don't think they're going to sell or don't strike you the same way, it's not an ah-ha moment. it's a friction i feel in my stomach, i don't feel right about certain things and the
times i've been second-guessing things or allowed other people to sort of, to be a vendor, sell me something and i'll be like hmm maybe you're right is when i mess up. it's the times when i know this is going to sell and sticking with what i feel are the times when the products do very well. ♪ tell me boy, now wouldn't that be sweet ♪ >> once i'm set on something it's sort of hard to change my feeling on it. i think it's important to not change your mind and be all flip-floppy. i think that makes people a little crazy and i think everyone can do that here and there but i think it's important as you sort of are going in that direction and lead that way. ♪ lollipop, lollipop, oh, lolly, lolly, lolly ♪ >> i think putting the logo on everything has been good in terms of establishing a brand. we've never been high to blast our nine-color logo on bags and
t-shirts. it's important in terms of branding to own whatever has candy on it, bedding or apparel, that people think oh, that's from dylan's candy bar, before other places so the more we do the more we'll start to own those categories. ♪ oh, lolly, lolly, lollipop looking for a little guidance without having to hire a high-priced consultant? check out our website of the week. bizmore.com is a site that provides advice and fooez back to owners from their peers. panelists on the site will respond. you can check out articles about a wide range of topics. ♪ summer is here and the time is right for some outdoor fun. we're taking our elevator pitch outside once again, rod and
vivian are headed to your business picnic and the chef is about to serve up a tasty pitch. >> what you cooking there? >> how are you doing? i'm jim barber, ceo of funny bones llc, we provide a bunch of barbecue sauces, marinades, rubs. today i want to introduce you to funny bones sweet and tangy style barbecue sauce for chicken, beef, pork, tofu, turkey. you can use it in the oven, on the grill, good 365 days a year no, artificials, flavors, colors preserve terve preserveives. we've had a lot of success the earlier part of this year, i sold over 30,000 jars of sauce in our first six months of production. i'm looking for someone to invest $1 million in my company
in order to -- >> are you going to use it on marketing or product development? that's okay. >> marketing and product development and to grow my compa company. >> i'm going to start with you. first of all i love it, from the set to the barbecue like that. >> a little overdressed for the picnics. you are the food person of the bunch. what did you think of the pitch? >> it was great. you have initial market acceptance, you sold 30,000 bottles so you're on your way but the key to run a successful food business is to have distribution. how do you plan on distributing your product? is it gourmet food stores, supermarkets, is it online? >> so be sure in the minutes that you have, at least have a line or something in there. what did you think in. >> he lost me at tofu. i love barbecue. tofu did not belong in here. i can tell your passion about barbecue. if you're cooking i would definitely take another meeting.
to your point, distribution is key. there's a lot of barbecue sauces on the shelf so i worry about distinguishing your brand but finding ways to extend that brand with different products. >> we're ready to put our finger in there. moment of truth, would you take another meeting? >> i would like to hear more. market acceptance and distribution. >> i have no qualms eating barbecue in the morning, let's get this chicken going. >> thanks for coming on the program. thanks for everybody. we appreciate it. if any of you have a product or a service and you want feedback from our elevator pitch panel on your chances of getting interested investors, all you have to do is send us an e-mail. the address is yourbusiness busine firstname.lastname@example.org. what your company does, how much money you're trying to raise and what you plan to do with that? somebody may be interested in
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to learn more, click on our website. it's yourbusiness.msnbc.com. you'll find all of today's segments plus web-exclusive content with more information on how to help you grow your business. >> my own? >> did i get called on? >> yeah. >> you beat me. >> you got called on but you wish you hadn't because you were wrong, it's not b. >> it's c. >> nice ll lly done, riva. also click on the news vine icon and take part in our community discussions about today's topics. next week, drum roll, please, how one man's obsession with creating the perfect drumstick turned into a business. >> it's just very, very comfortable and consistent. >> it's a great stick company. >> considered the gucci or the liouis vuitton of drumsticks.
>> drumming up business built on a reputation for perfection. i'm j.j. ramburg. remember we make your business our business. during times like these it seems like the world will never be the same. but there is a light beginning to shine again. the spark began where it always begins. at a restaurant downtown. in a shop on main street. a factory around the corner. entrepreneurs like these are the most powerful force in the economy. they drive change and they'll relentless push their businesses to innovate and connect. as we look to the future they'll be there ahead of us, lights on, showing us the way forward.